Posted July 02, 2021
By Aaron Gentzler
Minimum Wage and The Constitution
“I keep hearing concerns about inflation and people wanting a higher minimum wage,” a reader says. “I’m confused…
“How do folks think higher wages will help them financially if inflation sets in? If minimum wage is a limo, inflation is the chauffeur that drives it. Inflation would affect the cost of EVERYTHING we purchase.
“If wages increase, the cost of everything increases too.”
“I'm curious if readers know why we let our federal government get away with crap like a minimum wage law,” another contributor says.
“Isn't the U.S. Constitution pretty direct in its wording? My copy of the constitution doesn't say anything about wages. The 10th amendment says if it isn't in there, it's up to states to decide.
“Seems if our elected representatives go beyond their powers -- and don't care or realize it -- we should be voting them out.”
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Your Rundown for Friday, July 2, 2021...
Uber Competitor (Dogged by China)
News emerged this morning about the recent IPO Didi Global Inc (ticker: DIDI).
“Founded in 2012 by Cheng Wei,” Bloomberg notes, “Didi managed to force a retreat of its U.S. rival Uber Technologies Inc. in 2016 and embarked on an ambitious international expansion.”
“Didi's main business is ride-hailing in China,” Reuters says. “It operates in 15 international markets including South America, Japan, Australia, Russia and South Africa. It also provides services including food delivery, community group buying and logistics.”
To give you an idea, despite the pandemic, “the company delivered an $837 million profit in the March quarter,” says Bloomberg.
“The U.S. IPO was highly anticipated and marked the second-biggest debut by a Chinese company, trailing only Alibaba.” Didi started trading Wednesday in New York with many financial talking heads urging investors to buy.
But shares dropped early this morning, down almost 9% to $14.95 at the market’s open. (Shares are down about 5% at the time of writing.)
“China said it’s starting a cybersecurity review of the ride-hailing company just two days after it pulled off one of the biggest U.S. stock market debuts of the past decade.”
The timing’s suspicious: “coming not just on the heels of Didi’s IPO but also the Communist Party’s 100th anniversary celebrations in Beijing,” Bloomberg says.
Beijing seems to be reasserting control over Didi and other Chinese tech companies. Exactly how that affects publicly-listed companies in the U.S. remains to be seen. For now, however, the consensus among financial wonks is Didi’s still a buy.
Check back as we follow this story…
Market Rundown for Friday, July 2, 2021
The S&P 500 Index has hit another record high: 4,322.
Oil is down just 47 cents to $74.74 for a barrel of WTI.
Gold is up $13 to $1,290 per ounce.
Bitcoin is up $290 to $33,305.
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We hope you have an outstanding holiday weekend; the market’s closed Monday to commemorate Independence Day, so we’ll be back Wednesday. We’ll talk then…
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